Sluggish activity in key industries dragging down Singapore economy's growth

The economy might have grown 15.5% yoy for the first three quarters of this year, but Q3 also marked the first qoq saar contraction since Q4 2009 at -19.8% qoq saar.

In a statement, OCBC Bank said that while Q3 GDP growth was a sharp moderation from Q2’s 19.6% on-year to 10.3% on-year, the official 13-15% yoy growth forecast is achievable.

It noted, however, that some sectors contributed to the dip in numbers. “The main drag came from manufacturing, especially biomedicals (pharmaceuticals), following the end of the restocking story. Besides manufacturing, other growth engines like construction and services are also beginning to show some signs of fatigue,” OCBC said.

Nevertheless, MAS moved to tighten monetary policy by slightly steepening the slope and widening the band of the SGD NEER in mid-Oct to combat inflationary pressure, with the September CPI accelerating from 3.3% yoy in August  to 3.7% yoy in September.